A bonfire of bureaucracy, unnecessary targets and red tape could save the taxpayer £4.5 billion a year, a new report published today has revealed.
The Local Government Association has outlined a series of measures that could save money both centrally and locally while protecting frontline services.
Ahead of next month’s Pre Budget Report, the LGA has published Delivering more for less: maximising value in the public sector – which includes examples of unnecessary activity identified by councils, through their experience of working with Whitehall. Councils say the activity could be stopped without harming the quality of services people receive.
Local authorities recognise that an era of austerity, and tough financial decisions, lies ahead regardless of who wins the next election – and understand that they will need to play their own part in helping the country respond to the spending challenge. But the report identifies a set of straightforward measures to remove unnecessary administration and red tape that could save £4.5bn a year before local services are affected.
These include:
* £400m from further reductions in data burdens on councils (including performance indicators and reporting to central government) – equal to £11 per household per year
* £250m from halving direct costs of regulating local government, abolishing government offices and reallocating funding for central government improvement bodies to local government
* £1.5bn from reducing the departmental administration costs of seven departments with close links to local authorities by 20 per cent
* £1bn saving on the departmental resource budgets through reducing unnecessary policy activity
* £900m savings from giving councils greater spending flexibility
* £430m from unnecessary spending by quangos on administration
Research by the LGA has found that the annual £4.5bn savings could protect 300,000 school places, 175,000 personal care packages and 36,000 miles of road resurfacing.
The report found that over the last ten years the number of full time employees working in central government has increased by 21 per cent. Communities and Local Government (CLG), the main Whitehall department councils deal with, has reported a 10 per cent increase in permanent staff in just one year– from 1,942 in 2007/08 to 2,148 in 2008/9.
Quangos have also significantly increased their expenditure. In 2008, 790 quangos were responsible for £43bn of public expenditure – equivalent to £2,000 per year for every household in the country. This has risen from £24bn in 1998.
Commenting on the report’s findings, Cllr Margaret Eaton, Chairman of the LGA, said:
“Billions of pounds of taxpayers’ money is being spent on needless bureaucracy. We need a bonfire of red tape so that taxpayers’ money can be freed up to protect frontline services.
“Things need to be done better and cheaper. If we are to repay the large public debt, we simply cannot afford the same amount of excessive central activity and control of local services. The recession is forcing everybody who spends taxpayers’ money to think about how they can do more with less. Staying the same is not an option.
“Councils are determined not to rest on their laurels and will look to make even more efficiency savings, but are being held back by the costs of centralised regulation, inspections and bureaucracy. This expenditure is taking resources away from frontline services.
“We want to start a debate about how Britain can run things better in these times when all public spending is under intense scrutiny. Whether it is care for the elderly, schools or rubbish collections, people want to know that the standard of the services they use is going to remain high.
“There are a huge number of quangos spending public money and running large numbers of public services. We need to make sure there is no unnecessary bureaucracy and that the vast array of different bodies providing public services do not waste money by duplicating the work others already carry out.
“Councils are elected by local people and run by people who live in the towns and villages they serve. As the most efficient part of the public sector, local government is well placed to make sure that people get the very best value for money.”
